If you’re like most lawyers practicing independently or in small firms, you’re probably doing so without a dedicated administrative professional at your disposal. Do you have an accurate estimate of how much of your time is spent performing administrative tasks to manage your small law firm or solo practice? How does that stack up against the amount of time you’re actually spending practicing law? Take those non-billable hours and multiply it by your current hourly rate. Yikes, it’s pretty painful when you look at that time in terms of lost revenue.
We aren’t telling you anything you don’t know here: maximizing billable hours has a direct impact on your bottom line. But the cost of being a rock star solo or small firm lawyer means doing more with less and probably doing more yourself. Although necessary to support a successful practice, if you aren’t performing these admin tasks as efficiently as possible (by outsourcing or automating with low-cost software), you’re flat out losing money and missing an opportunity.
Survey says: small law firms are spending too much time on admin work
According to a Thomson Reuters survey, the “2016 State of U.S. Small Law Firms Study,” firms that defined themselves as “very successful,” reported spending at least 63% of their time practicing law and 7% of their time on admin tasks. In contrast, firms self-reporting as “unsuccessful” or flat (“neither successful nor unsuccessful”) said they spend 53% of their time practicing law and twice as much time (14%) performing admin tasks.
If your practice-to-admin ratio isn’t favoring billable hours, you’re losing potential revenue. Luckily, some repetitive tasks can be handed over to technology.
Digitize your admin duties
If you can’t yet justify hiring admin staff or outsourcing admin services, technology tools are available to help you. The time spent ramping up on tool functionality is worthwhile if it can save you hours of time each week. Following are some easily automatable tasks that you can take off your plate using simple online tools.
Manual billing: Maybe your Excel spreadsheet and Word templates are working just fine? Oh wait, is that another client’s contact info you accidentally included? And, hang on, which accounts payable are currently past due? Do you need to sort first?
A small client roster might not demand more than old-school billing techniques. But even so, an online legal payments solution can not only save you time but also automate some of the accounting details specific to legal accounting, like ensuring certain money is directed to certain accounts.
A legal payments solution will save you time with invoice templates that automatically populate client contact info and a dashboard that instantly displays the status of all accounts payable. Automated follow-ups on past due invoices can save you from being the bad guy. And, overall, it just looks a lot more sophisticated and professional.
Offline time tracking: Just, why? Recording time on a legal pad or in a spreadsheet, along with notes on which client and which task it refers to, then adding up the time and manually listing that information in your invoices is not only inefficient, but it also introduces the risk of inaccuracy.
Using a time-tracking app allows you to click a button at the start of a task, then click again to stop the timer when the task is complete. Most time trackers also provide reporting dashboards so you can see a visual breakdown of all your recorded time.
Legal billing solutions that include time tracking, like Headnote, automatically import your time to the right client’s invoice, ensuring accuracy, thoroughness, and speed.
Recreating documents: The legal profession involves a lot of paperwork, even if most of the documents are now digital. We all know this is true. But a lot of lawyers still spend too much time digging up existing docs they’ve created for other clients and plugging in new information. Or manually searching their case files to pull existing legal language into a new document.
Much of your legal documentation can be more easily managed by using a document management system (DMS). Most allow you to enter client information once, then apply it to unlimited document creation. You can customize templates for a specific client, then pull it up with a few clicks. Some DMS systems allow you to automatically create first drafts of long, legalese-heavy documents by searching case files or a specified database for the language you need, which beats cutting and pasting every time.
Client onboarding: You can never automate the human touch required to gain a new client’s trust. You need to communicate effectively to get all of the info you’ll need. But taking on a new legal client also includes a lot of form filling, document scanning and uploading, and so on.
The less personal aspects of client onboarding can be easily streamlined with online forms, digital signature capabilities, and automated follow-ups to remind clients to perform certain tasks. Practice management suites often include many onboarding capabilities. Or you can assemble your own digital toolkit using low-cost or free applications. Headnote, for example, will provide engagement letter templates and automated follow up in the near future. Take a look at our productivity tool guidelines for small firms and solo lawyers here.
To get ahead, get digital
The admin duties needed to manage a small law firm will never go away, but you can reduce the time you’re spending on them. If you’re hesitant to invest in the time needed to ramp up new processes, know that most digital tools—especially the apps that address limited functions—are easy and intuitive to learn.
You can also start slow by dipping your toe in the digital waters and starting with a single function, like billing and invoicing. Headnote allows you to get started by creating a simple profile, linking your financial accounts, and inputting your basic client information, like name and address. You can start sending digital invoices in 10 minutes flat, while also allowing modern benefits like accepting online payments. It’s one step toward digitization that your clients will notice and appreciate, and you probably will too.